June 05, 2020


Jonathan D. Urick, U.S. Chamber Litigation Center

Growing litigation, novel theories of liability, the debate over liability protection, and the pandemic’s impact on settlement values highlighted this week’s reporting on business litigation related to COVID-19.

More and more litigation

The ABA Journal reports that corporate law firms are warning clients to brace for the building wave of coronavirus litigation. “Among the areas of expected litigation are suits for injuries and wrongful death, discrimination, employment liability insurance, privacy violations and retaliation.”

Novel theories of liability highlights one company’s legal battle against such claims. Princess Cruise Line has moved to dismiss 13 cases brought by uninfected passengers suing for emotional distress. In its motion, the cruise line argues that, “[i]f accepted, plaintiffs’ theory would open the door to open-ended liability for every business, school, church, and municipality across America, stalling economic recovery in the wake of the COVID-19 pandemic and complicating the ability of businesses to reopen.”

Over at Law 360, Diane Flannery and three McGuireWoods colleagues examine how reopening businesses might (or might not) be liable for second-hand coronavirus exposure that infected employees or customers transmit to their families, friends, or roommates. The attorneys survey the relevant law from 15 states and offer various recommendations for businesses to limit their potential liability.

Liability protection

A Newsday op-ed urges New York State to extend COVID-19 liability protections as the state reopens. “Now that the state is reopening, it is not just medical workers who need protection from lawsuits,” the editorial argues. “[W]ithout proper liability protections,” businesses, schools, and nonprofits “will be left vulnerable” to an “onslaught of litigation.”

Other states are heeding these warnings. Claims Journal reports that North Carolina, Oklahoma, Utah, and Wyoming recently enacted coronavirus-liability protections for reopening businesses, “while legislation in at least three other states is advancing.” According to Roll Call, however, in the U.S. Senate, federal liability protections remain a “sticking point in the debate” over the next COVID-19 relief bill.

Settlement value

Finally, the Insurance Journal examines anecdotal evidence that the COVID-19 pandemic may be exerting downward pressure on tort settlement values, possibly reversing the recent strong upward trend.

Settlement and verdict sizes have been increasing for a variety of claims “throughout the tort world,” according to one liability-insurance underwriter. “It’s too early to tell” if that trajectory is really changing, he cautioned.

But some corporate defense attorneys report that plaintiffs’ counsel is more willing to settle than before the pandemic because of closed courts, significantly delayed trials, and concern that even once courts reopen, jurors facing economic hardship may be more reluctant to award plaintiffs large damages.